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"After a rocky start to 2016, Norway’s $900 billion sovereign wealth fund announced today that it made a return of almost 7% last year (pdf), more than doubling its result the previous year. The unlikely source of this $53 billion windfall? US president Donald Trump. American stocks have been on a tear since Trump was elected, as investors predict tax cuts, deregulation, and other business-friendly policies will boost corporate profits. Just under a quarter of the Norwegian fund’s assets are invested in US stocks.
Last year started off badly for the world’s largest sovereign fund, with global stocks falling by 10% in the first few weeks of 2016. Norway’s government also made its first withdrawal from the fund after 20 years as falling oil prices cut into Norway’s commodity-driven economy."

"Annual growth in Saudi Arabian bank lending slowed in January to its lowest level in nearly seven years, official data showed on Tuesday, a sign of weak corporate demand but also improving liquidity in the economy.

Bank loans to the private sector rose just 1.8 percent from a year earlier, compared to 2.4 percent in December, the central bank said. It was the slowest growth since February 2010, when the Saudi economy was still recovering from the global financial crisis.

The sluggish growth shows private companies have little desire to make fresh investments, because of an economic slump caused by low oil prices and government austerity measures."

"Citigroup Inc. is in advanced discussions for a banking license in Saudi Arabia, returning after a more than 10-year absence from the kingdom, as the bank looks for ways to capitalize on financial reforms, according to people familiar with the matter.

The New York-based bank has started sounding out potential staff in expectation that the license application will succeed, the people said, asking not to be identified as the information is private. Ahmed Bozai, Citigroup’s chief operating officer for Middle East and Africa, and Carmen Haddad, a senior private banker for the firm’s operations in the region, are among executives in talks with Saudi Arabian regulators, two of the people said.

The bank has yet to receive a license and talks may still falter, they said. A spokeswoman for Citigroup declined to comment. The Capital Market Authority, which would issue the license, said in a statement that it won’t comment on any application before a final decision is reached."

A monthly Reuters poll, published on Tuesday, found 62 percent of Middle Eastern fund managers expected to decrease their allocations to Qatari equities over the next three months and none to increase them. That was the most negative outlook towards Qatar since the survey was launched in September 2013."

"Shares in Australian energy services company WorleyParsons jumped by about 30 per cent today after Dar Group, a Dubai-based consulting group, revealed it had taken a 13.35 per cent stake in the company. Privately-owned Dar Al-Handasah Consultants Shair and Partners, which Worley confirmed as having made a takeover offer in November, said in a note to the ASX today it had acquired an 8.61 per cent stake via physical shares and exposure of 4.74 per cent by way of a cash-settled equity swap exposure. Dar said it had purchased the stake “with a long term strategic perspective and looks forward to being a supportive shareholder.”"

"Investigations by Ras Al Khaimah’s Public Funds Prosecution have revealed new evidence of the involvement of former government employees in the embezzlement of public funds. According to Ras Al Khaimah Attorney General Hassan Saeed Mohaimed, the new evidence uncovered the involvement of accomplices from the US and other countries in the public funds embezzlement. Investigations revealed that Dr Khater Massaad and Karam Al Sadiq along with other suspects had embezzled and misappropriated government funds during their tenure as government employees."

"India is considering selling a majority stake in Air India to a strategic partner after a $3.6 billion bailout failed to turn around the loss making national carrier, people with knowledge of the matter said. The proposal includes reviving Air India within five years of selling a 51 percent stake, the people said, asking not to be identified as the information isn’t public. Talks are at an initial stage and presentations have been made to the finance ministry and the prime minister’s office, they added. The government isn’t planning to sell 51 percent stake in the carrier, Civil Aviation Secretary R.N. Choubey said in New Delhi. D.S. Malik, a spokesman at the Ministry of Finance declined to comment. Neither did Dhananjay Kumar, Air India’s spokesman."

"The Iranian economy has had an “impressive recovery” following sanctions relief last year, though new uncertainty regarding the fate of the nuclear deal and relations with the U.S. threaten to undermine it, the International Monetary Fund said. Iran’s economy is expected to grow 6.6 percent in the calendar year ending March 20 and stabilize at 4.5 percent “over the medium-term as the recovery broadens,” the IMF said in a report released on Monday. The report also highlighted the government’s ability to maintain inflation in single digits and stabilize the foreign exchange market. The Washington-based lender warned, however, that “renewed uncertainty” surrounding the viability of the nuclear deal between Iran and six world powers and, in particular, relations with the U.S., “could deter investment and trade with Iran and short-circuit the anticipated recovery.”"

"Majid Al Futtaim, a United Arab Emirates-based conglomerate, has released initial pricing guidance for its planned subordinated, unsecured perpetual bond in the high 5 percent area, according to a document issued by the lead banks on Tuesday. The bond, issued by MAF Global Securities and guaranteed by Majid Al Futtaim Holding and Majid Al Futtaim properties, is expected to price later on Tuesday. The joint lead managers and bookrunners of the debt sale are Barclays, Emirates NBD Capital, Goldman Sachs International, HSBC, National Bank of Abu Dhabi and Standard Chartered Bank. "

"Saudi Arabia wants crude oil prices to rise to around $60 a barrel this year, five sources from OPEC countries and the oil industry said. This is the level the OPEC heavyweight and its Gulf allies - the United Arab Emirates, Kuwait and Qatar - believe would encourage investment in new fields but not lead to a jump in U.S. shale output, the sources said. The Organization of the Petroleum Exporting Countries, Russia and other producers pledged last year to cut production by about 1.8 million barrels per day (bpd) from Jan. 1. The first cut in eight years is intended to boost prices and get rid of a supply glut."

"Top global oil exporter Saudi Arabia broke from the pack in the race to lock up Asian market share after agreeing on Tuesday to pump $7 billion into a refinery-petrochemical complex in Malaysia, analysts said. State oil giant Saudi Aramco's IPO-ARMO.SE investment into Malaysia's RAPID project will secure an outlet for its crude oil for at least two decades and beefs up its downstream portfolio ahead of its initial public offering (IPO) next year. The competition in Asia among producers, including Russia and other Middle Eastern suppliers such as Iraq, Kuwait and Iran, is sharp. Asia's growing oil demand provides the only home for the producers' output, especially as they have lost market share in the United States to rising domestic shale oil production."

"Dubai's stock index outperformed in an otherwise weak Gulf region in early trade on Tuesday as investors bought shares that had recently fallen.

The Dubai index added 0.5 percent, with advancing shares outpacing declining ones by 17 to three. Small-to-mid sized stocks were the top gainers, with Union Properties climbing 4.0 percent. Shares of telecommunications operator Etisalat, the largest stock on Abu Dhabi's exchange, fell 1.1 percent to be the main drag on the index, which was down 0.2 percent.

"Saudi Arabia’s fiscal reforms are looking more realistic and within the reach of the broad targets and schedule set by the government, thanks to recent recovery in oil prices and gradual reforms gaining traction, according to economists. Growth rebound, higher oil prices and reforms supporting non-oil economy are key Saudi priorities in its plans to cope with the new economic realities. Structural reforms to attract foreign direct investments and diversification of revenue through investments abroad are also part of the plan. King Salman’s ongoing Asian tour that began on Sunday is aimed at building ties with the world’s fastest growing importers of Saudi oil and promote investment opportunities in the kingdom, including the sale of a stake in the state firm, Saudi Aramco."

The French oil major -- the first of its peers to strike deals in Iran after sanctions -- seeks entry into Iran LNG at a discount to the pre-sanctions price in exchange for reviving the stalled project, two sources with knowledge of the matter said. A third source confirmed Total was in the running for a stake, alongside several other oil majors, but any deal was still some way off.

Total declined to comment. Iran's National Gas Export Co. (NIGEC), a central stakeholder in the project, did not respond to requests for comment by email and phone.

"Saudi Arabia may increase its domestic gasoline prices by 30 percent from July, industry sources said, part of a reform plan by the world's top oil exporter to align its fuel prices with global benchmark levels. In December 2015 the kingdom raised the price of 95 octane gasoline to 0.90 riyal ($0.24) per litre from 0.60 riyal. However, that still kept Saudi Arabia among the countries with the cheapest gasoline prices in the world."

"Profit-taking dragged stock markets in the Middle East down on Monday, with Egypt lagging after some quarterly earnings failed to inspire.

Saudi Arabia's index lost 1.1 percent to 6,969 points, heading back down towards technical support at the mid-February low of 6,942 points. A little under nine-tenths of traded shares declined and trading volume was above the 10-day average.

All 14 listed petrochemical makers closed down with National Industrialization Company (Tasnee) the biggest loser, dropping 4.8 percent."

"The exact dollar value of Saudi Aramco may be up for debate, but the listing of the world’s biggest company will be priceless for the kingdom’s markets.

The highly-anticipated share sale has become emblematic of Saudi Arabia’s push to transform its economy and open its doors to more foreign capital. Whatever you think of the valuations involved -- be it the $2 trillion once suggested by Crown Prince Mohammed bin Salman or the $400 billion estimate said to have been made by consultant Wood Mackenzie Ltd. -- the offering has the potential to make waves in markets from Tokyo to Toronto.

Aramco’s “partial privatization will bring much attention on Saudi Arabia,” said Michael Bolliger, the Zurich-based head of emerging-market asset allocation at UBS Wealth Management, which has clients worth $2.1 trillion. “As part of a broader privatization program of state-owned companies, it reinforces the message that the kingdom’s strategy is to develop a domestic capital market and gradually open it up to international investors.” "

"Qatar Petroleum plans to merge two petrochemical units in its latest consolidation of businesses, as the world’s fourth-biggest oil and natural gas producer seeks to trim costs in its domestic operations and expand internationally. The state-run company will fold the operations of Qatar Vinyl Co., part of Mesaieed Petrochemical Holding Co., into Qatar Petrochemical Co., a unit of Industries Qatar QSC, it said Sunday in an e-mailed statement. Qatar Petroleum owns 74.2 percent of Mesaieed and 51 percent of Industries Qatar, according to data compiled by Bloomberg. Both companies are listed on the Qatar Stock Exchange. Shareholders “will directly benefit from this integration as it reduces the operating cost and enhance the profitability of both companies,” Qatar Petroleum Chief Executive Officer Saad Sherida Al Kaabi said in the statement. The merger will begin in March and be completed this year through a service-agreement arrangement, QP said. "

"Russia has been in talks of buying oil from Iran, Energy Minister Alexander Novak said on Monday, confirming earlier reports. At the sidelines of a economic forum in the Black Sea resort of Sochi, Novak told reportes he expected the deal to be reached "within weeks." The purchases will be carried out via Promsirieimport, a trading unit of Russia's Energy Ministry, he said. Last week, Iranian Students' News Agency (ISNA) reported that Iran will begin selling 100,000 bpd of to Russia within the next 15 days and receive payment half in cash and half in goods and services. "

"Oman aims to conduct a large U.S. dollar bond sale this week that could exceed $2 billion, and also plans to issue dollar sukuk over the next few months to plug a budget deficit caused by low oil prices, investors said. The government intends to sell a conventional bond with maturities of five, 10 and 30 years, according to lead banks, probably after roadshows end in the United States on Tuesday. Oman has also mandated banks for a dollar sukuk, which could come soon after the conventional issue, said the investors, who obtained their information from roadshows conducted by Omani officials in the United Arab Emirates on Sunday."

"Dubai's Emaar Malls said on Monday its board had recommended paying a cash dividend of 0.1 dirham ($0.03) per share for 2016. The dividend would be the same as the payout for 2015. Emaar Malls, part of Emaar Properties, reported a 3.9 percent rise in fourth-quarter net profit to 452 million dirhams. "

"Stock markets in the Gulf were mostly slightly lower in thin early trade on Monday as there was little domestic or international news to stimulate activity.

Saudi Arabia's index inched down 0.1 percent in the first 15 minutes. Real estate fund Riyad REIT, which jumped 9.4 percent on Sunday, was down 1.0 percent in volatile trade. There was little trading of most blue chips.

Sunday, 26 February 2017

"Middle East and North African governments are likely to issue less commercial debt this year as budget deficits improve after record issuances last year, a report said on Sunday. The latest research from S&P Global Ratings said sovereign borrowing is set to decline by 20 per cent to US$136 billion following record debt issuances of $170bn last year. "We project that the 13 Mena sovereigns that we rate will borrow an equivalent of $136bn from long-term commercial sources in 2017," said Trevor Cullinan, a primary credit analyst based in Dubai for S&P."

"Saudi Arabia’s stock exchange is seeking to secure its first regional cross listing by 2018 to boost foreign investment in the Middle East’s largest bourse. The Tadawul, as the market is known, will hold discussions with companies already listed on other exchanges in the Gulf Cooperation Council to encourage them to also list shares in the kingdom, Chief Executive Officer Khalid Al Hussan said in an interview in Riyadh on Sunday. “Definitely by 2018 we would expect to see at least one company cross listing onto the main market from another exchange," he said. The Tadawul also wants private companies in the GCC to sell shares on its alternative market, Nomu, with the first expected this year, he said."

"Saudi Arabia is counting on rules that will extend the settlement cycle on stock trades to attract more foreign investors, Capital Market Authority Vice Chairman Mohammed El-Kuwaiz said. The Tadawul stock exchange has about 50 qualified foreign investors and expects to draw more after shifting to a T+2 cycle by the end of June, a system used across most major exchanges, El-Kuwaiz said in an interview with Bloomberg News. The current system requires same-day settlement. “A lot of financial advisers are looking at the opening up of the market, the privatization program and the change in the overall market infrastructure as an opportunity,” and the regulator has seen "a tremendously increasing amount of interest" from foreign firms seeking licensing to operate in Saudi Arabia, El-Kuwaiz said at the launch of a secondary market called Nomu."

"Gulf stocks generally moved little in thin trade on Sunday but new listings surged on Saudi Arabia's secondary market as that bourse, which has less onerous listing requirements than the main Riyadh market, opened its doors for the first time. The main Saudi index edged up 0.1 percent. Real estate investment trusts, which have been soaring since Al Jazira Maten REIT listed in mid-February, continued to rise in heavy trade; Al Jazira climbed 9.8 percent and Riyad REIT gained 9.4 percent. In the new Saudi Parallel Market, all seven stocks jumped their 20 percent daily limits. They included retailer Abo Moati Stationaries, restaurant operator Raydan Cuisines and Al-Omran Industrial and Trading Co."

"The chairman of Dubai Holding, the investment vehicle of the emirate's ruler and a major force in developing the Dubai economy, has resigned to focus on his role in the national government, the conglomerate said on Saturday. As head of Dubai Holding since its founding in 2004, Mohammed Abdullah al-Gergawi came to oversee a $35 billion portfolio of assets in over 20 countries, in industries ranging from tourism and real estate to media, information technology and trade. Gergawi said in a statement it was time for another talented person, whom he did not identify, to take over Dubai Holding, and that he would now work full-time for the United Arab Emirates government. He is minister of cabinet affairs and in charge of strategy development in the national government."

"The new Abu Dhabi oil industry is taking shape. Last week’s signature by two Chinese companies for stakes in the emirate’s largest producing asset creates a bond that will last for 40 years. Now Abu Dhabi’s energy leaders have to navigate new relationships and show that their novel arrangements will keep up with the region’s measured but titanic energy changes. On February 19, the China National Petroleum Corporation (CNPC) signed for 8 per cent of the onshore Adco concession; the next day its compatriot China Energy (CEFC) took up 4 per cent. With BP and Total holding 10 per cent each, Japan’s Inpex 5 per cent and South Korea’s GS Energy 3 per cent, this completes the planned 40 per cent foreign stake, Adnoc holding the remainder. This represents a significant, although not complete, shift away from the emirate’s traditional western international oil company stakeholders. Japan and South Korea are long-term familiar partners; China much newer; and the other big customer for the emirate’s oil, India, is conspicuous by its absence."

"The current framework governing Islamic Banking (IB) contains many gaps that need to be closed through the development of a more comprehensive enabling environment that ensures financial stability and sound development, according to the Executive Board of the International Monetary Fund (IMF).
In a recently adopted staff paper “Ensuring Financial Stability in Countries with Islamic Banking”, the IMF calls for further strengthening of the legal and regulatory environment and institutional framework in countries that have Islamic banking.
“Islamic banking continues to grow rapidly, in size and complexity, posing a challenge to supervisory authorities and central banks. While accounting for a small share of global financial assets, Islamic banking has established a presence in more than 60 countries and has become systemically important in 14 jurisdictions,” the IMF study said."

"Evercore Partners Inc., the investment bank founded by Roger Altman, is planning to open an office in Dubai as it seeks new business in the region, including a role on Saudi Arabian Oil Co.’s initial public offering, according to people familiar with the matter. Evercore is in discussions to become a financial adviser to the state-owned oil giant, known as Aramco, after rival Moelis & Co. was hired for the listing, said the people, who asked not to be identified because the talks are private. Altman’s firm is in talks with bankers from competitors to staff the new Dubai office, which it plans to open this year, the people said. Evercore will start with a small team based in the Dubai International Financial Centre where many of its competitors are based, the people said. A representative for Evercore declined to comment on the office plans or the bank’s potential role on the Aramco IPO. Aramco declined to comment."

"Gulf stocks were generally little changed in early Sunday trade but most new listings surged on Saudi Arabia's secondary market as that bourse, which has less onerous listing requirements than the main Riyadh market, opened its doors for the first time. The main Saudi index edged down 0.02 percent in the first hour. Real estate investment trusts, which have been soaring since Al Jazira Maten REIT listed in mid-February, continued to rise in heavy trading volume; Al Jazira climbed 9.8 percent and Riyad REIT gained 5.1 percent. In the new Saudi Parallel Market, where seven stocks started trading, retailer Abdullah Saad Mohammed Abo Moati Stationaries rose 6.7 percent from its initial public offer price in volume of a little over 1 million shares."

"The Dubai Financial Market General Index (DFMGI) was down 16.85 or 0.46 per cent last week to end at 3,633.91. Market breadth was bearish with 19 declining issues and 11 advancing, while volume fell slightly below the level of the prior week. Even though the index was down for the week it made a decent recovery after falling as much as 2.7 per cent at the week’s low of 3,551.01 reached on Tuesday. That decline gave bearish signals. However, the week ended with the DFMGI in the top quarter of the week’s price range, a short-term bullish sign. Bearish signals earlier in the week included a breakdown of a relatively narrow six-week consolidation phase on a move below 3,608.40, and a drop below the 55-day exponential moving average (ema), which is now at 3,615.50. A relatively sharp rally occurred off the week’s low (at the 21-week ema) on Wednesday. Therefore, the 21-week ema is a key trend indicator to watch for support in the future. If last week’s low holds during future weakness then it is a key component of the price structure of the three-month uptrend (higher swing low) and possibly the 13-month uptrend. "

"Dubai Holding announced today the financial results of its business group, Dubai Holding Commercial Operations Group (The Group), for the year ended 31 December 2016. The Group continued to see good operational progress with all businesses performing well and contributing to Group profitability. Net profit increased to Dh6.32 billion, up 8% from Dh5.83 billion, while total revenues increased by 16% to Dh16.84 billion compared to Dh14.53 billion last year. Mohammad Abdullah Al Gergawi, chairman of Dubai Holding, also announced that after obtaining the blessing of His Highness Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. and after having put Dubai Holding on a rapid growth path, his mission as chairman of Dubai Holding had come to an end, paving the way for another talented person to take over, dedicating his full time and effort to his duties in the government."

"OPEC has so far surprised the market by showing record compliance with oil-output curbs and could do so further in coming months as the biggest laggards - the United Arab Emirates and Iraq - pledge to catch up quickly with their targets. The Organization of the Petroleum Exporting Countries has pledged to curb its production by about 1.2 million barrels per day (bpd) from Jan. 1, the first cut in eight years, to boost prices and get rid of a supply glut. Compliance with output restrictions has often been problematic in OPEC's history but this time the group has delivered reductions amounting to as much as 90 percent of the target in the first month alone."

Friday, 24 February 2017

"Standard Chartered has made its second consecutive annual loss as the emerging markets-focused bank suffered another decline in revenues that offset the benefits of recent cost-cutting and lower bad debt impairments. StanChart, which is listed in London but mostly operates across Asia, the Middle East and Africa, reported a net loss of $478m, which trailed analysts’ expectations even though it improved on a $2.4bn loss in 2015 — its first for more than 15 years. Shares in StanChart, which have gained 92 per cent in the past year, fell more than 4 per cent to 720.8p in early trading on Friday."

"Iran is hard at work gaining a foothold in the global energy market, and it’s not letting U.S. President Donald Trump’s confrontational tone stop it from trying.

Political rhetoric is unlikely to turn into tangible impediments for Iran’s ambition to join Russia and Norway in the ranks of major gas exporters, according to Deputy Oil Minister Amir Hossein Zamaninia.

The nation has about $7 trillion worth of gas reserves sitting underground, based on European benchmark prices, and its doors are open to those who will help it cash in on the fortune. Zamaninia thinks those sorts of figures mean the business case for Iranian energy is too tempting for the world to pass up, even as its supreme leader Ayatollah Ali Khamenei and Trump exchange barbs."

"Saudi Arabia has said oil giant Saudi Aramco is worth more than $2 trillion, enough to consume Apple twice, and still have room for Google parent Alphabet Inc. The kingdom may have to settle for less. A lot less. Bloomberg's Richard Stubbe has more on "Bloomberg Daybreak: Asia." (Source: Bloomberg)"

"Jamil Farsi, a prominent Saudi Arabian jewellery tycoon, made an impassioned plea to the investment minister at a meeting of the Jeddah Chamber of Commerce this month.

"I don't know anything about economics but I beg you, and I beg the officials in the country, not to sell Aramco - not 5 percent, not 1 percent," he said.

Investment minister Majed al-Qasabi replied the economy would benefit from the sale of shares in national oil giant Saudi Aramco. It is expected to be the world's largest initial public offer, raising tens of billions of dollars."

"Saudi Aramco's initial public offering (IPO) could encourage other Gulf countries to list their oil assets, a leading regional economist said, but the oil giant must clear uncertainties over taxation, OPEC policy and ownership of crude.

Nasser Saidi, a former economy minister of Lebanon, told Dubai Eye Radio in an interview broadcast on Wednesday that Aramco has to address how the company will separate its assets and liabilities from those of the state.

"Many countries could follow in the region. (The) UAE I think could potentially be attracted to this," Saidi said."

"Credit Suisse Group AG, the Swiss lender seeking a banking license in Saudi Arabia, has allocated about $600 million of its own capital to expand its business in the kingdom, according to people familiar with the matter. The Zurich-based bank, which has a securities and equities business in the country, plans to use the capital to, among other things, offer investors Lombard loans, which are backed by liquid assets such as stocks, said the people, who asked not to be identified because the information is private. Such loans could help facilitate trading in local equities, they said. International banks are seeking to expand their operations in the kingdom as it embarks on an unprecedented economic shakeup under Deputy Crown Prince Mohammed bin Salman, who is seeking to reduce its reliance on oil after a plunge in prices that started in 2014. Iqbal Khan, head of the Credit Suisse’s international wealth-management business, said in an interview last year that the bank was in talks with the Saudi central bank for an onshore license."

"Hotels in Abu Dhabi and Dubai posted a subdued performance in January 2017 compared to a year earlier, with the overall average daily rates (ADR) dropping by 8 per cent, according to the latest data. “Abu Dhabi reported a 1.5 per cent decline and Dubai posted nearly flat performance,” said market research firm STR on Thursday. Smaller markets outside the city centres, however, were doing well in the beginning of the year."

"Bank shares were the main drag on most stock markets in the Gulf on Thursday on a lack of direction from the minutes of a U.S. Federal Reserve meeting that showed little support for a March rate rise and as oil traded in a range around $56.40 a barrel.

Saudi Arabia's index edged 0.3 percent lower after an hour of trade with half of the listed lenders declining. Saudi British Bank lost 1.3 percent and National Commercial Bank fell 0.7 percent.

Bank sector analysts expect a rising interest rate environment in 2017 would bode well for lenders in the region, boosting their net interest margins, although lower rates and easing liquidity concerns may encourage the private sector to borrow more."

Wednesday, 22 February 2017

"As a list of investment risk factors go, the 30 pages of potential downsides that Russian steel group Severstal provided on a recent prospectus for a fundraising round worth up to $4.5bn was brutally honest.

The list included the standard legal jargon on the unpredictable potential of an easing of global growth, the cyclical nature of the steel industry and the threats posed by inclement weather. But the prospectus also included a series of warnings acutely specific to Russia that spelt out just what investors could expect from the country.

Warnings of potential state interference into industries, political pressure placed on companies, corrupt court proceedings, bribery, organised crime and the threat of tax investigations and imprisonment against executives jump out in a prospectus that itself warns that only “sophisticated investors who are familiar with and who fully appreciate the significance of the risks involved” should apply."

"Fitch Ratings has affirmed the Long-Term Issuer Default Ratings (IDRs) of five UAE banks with Stable Outlook and maintained Rating Watch Positive (RWP) on First Gulf Bank's (FGB) IDRs. The agency also downgraded the Viability Rating of Union National Bank (UNB) to 'bbb-' from 'bbb'. A full list of rating actions is at the end of this commentary. KEY RATING DRIVERS IDRs, SUPPORT RATINGS AND SUPPORT RATING FLOORS The affirmation of National Bank of Abu Dhabi's (NBAD), Emirates NBD's (ENBD), UNB's and Abu Dhabi Commercial Bank's (ADCB) Long-Term IDRs, Support Ratings and Support Rating Floors (SRF) reflects the extremely high probability of support from the UAE authorities, and governments of Abu Dhabi (AA/Stable/F1+) and Dubai, if required. FGB's Long-Term IDRs of 'A+' also reflect the extremely high probability of support from the state. Fitch's view of support reflects the sovereign's strong capacity to support the banking system, sustained by UAE's sovereign wealth funds and on-going revenues from hydrocarbon production, despite lower oil prices, and the moderate size of the UAE banking sector in relation to the country's GDP. Fitch also expects high propensity from the authorities to support the banking sector, which has been demonstrated by the UAE authorities' long track record of supporting domestic banks, as well as close ties and part-government ownership links to a number of banks."

"JPMorgan and Morgan Stanley have been handed the keys to the kingdom. The U.S. investment banks are poised to lead the underwriting of Aramco's $100 billion share offering. The prized mandate has the potential to propel both to the top of investment banking league tables and unlock a stream of future work as Saudi Arabia reforms its economy and sells off its large inventory of state assets. An IPO flop, however, could be fatal for the banks' local franchises. The state-owned oil giant is assembling bankers ahead of the listing, which is scheduled for 2018. JPMorgan and Morgan Stanley look set to join boutique firm Moelis, which was appointed as an independent adviser earlier this month, and veteran banker Michael Klein, who has been working for months at Aramco's headquarters in Dhahran. HSBC could also be handed a mandate to help secure Chinese investors, Reuters reported on Wednesday. A leading role would be a big win for JPMorgan and Morgan Stanley, both of which rank outside the top five for fees earned on IPOs in the Middle East since 2010, according to Thomson Reuters data. The banks will have to share the stage with rivals as Aramco seeks to drum up support for what would be the world's largest-ever IPO. A bonanza is far from assured: competition to help with the restructuring of the Middle East's largest economy is fierce, and Riyadh has the upper hand in negotiations over fees. Nevertheless, a leading role on what is likely to be an intricate multi-exchange listing will help secure other more lucrative mandates as the reform plans of Deputy Crown Prince Mohammed bin Salman take shape. JPMorgan and HSBC had strengthened their credentials by arranging Saudi Arabia's $17.5 billion debut international bond offering last year, which was four times oversubscribed."

"Dubai's share index rose on Wednesday as builder Arabtec surged after getting approval from the securities regulator to increase its capital, while Saudi chemicals producer Tasnee gained on news it will sell a major business segment. Arabtec jumped by its 15 percent daily limit percent to 0.97 dirham, bouncing off its lowest closing level in five years on Tuesday. The builder said it received initial approval from the stock market regulator for its recapitalisation programme, subject to completion of its 2016 financial audit and a final sign-off."

"Saudi Arabian Oil Co., gearing up for what may be the world’s biggest initial public offering, is considering discounted shares for local investors, according to people with knowledge of the matter.

The oil company has discussed ways to structure the offering in different tiers, allowing Saudi buyers to receive the stock at a lower price than international investors, the people said, asking not to be identified as the talks are private.

Shares in companies owned by the Saudi government have traditionally been offered to locals at a nominal value of about 10 riyals ($2.67) each -- usually far below their true worth. The stock market regulator last year approved new rules to price initial public offerings based on demand."

"Gazprom Neft, Russia’s fourth largest oil producer, reported net profit of 200bn roubles ($3.49bn) in 2016, up 82.5 per cent on 2016, on increased production and lower local costs. EBITDA in the fourth quarter of the year rose 8.2 per cent to 131bn roubles, beating forecasts by VTB Capital of $1.6bn, on higher than expected production. The company, owned by gas producer Gazprom, said production last year rose 8.2 per cent to 86.2m tonnes of oil equivalent, in a year that ended with promises from Russia to join an OPEC-led cut to global oil production."

"Dubai's share index rose on Wednesday after builder Arabtec rebounded sharply upon receiving approval from the securities regulator to boost its capital, while Saudi chemicals producer Tasnee jumped on news it will sell a major facility. Arabtec jumped 6.3 percent to 0.89 dirham, bouncing off its lowest closing level in five years on Tuesday. The builder said it received initial approval from the stock market regulator for its recapitalisation programme, subject to completion of its 2016 financial audit and a final sign-off. The construction company reported a wider fourth-quarter loss earlier this month and the board said it was seeking shareholder approval for a 1.5 billion dirham ($408.4 million) rights issue. "

Tuesday, 21 February 2017

"DP World has won an arbitration case against the government of Djibouti, which claimed the Dubai ports operator made illegal payments to win a concession to operate a container terminal in the Red Sea African state.

A London tribunal ordered the government to bear legal and other costs, throwing out claims that DP World had bribed Abdourahman Boreh, the former head of Djibouti’s ports free zone authority.

"U.S. prosecutors are pushing forward on an Iran sanctions investigation that had languished during the multiyear period when Washington and Tehran were negotiating their nuclear pact, according to people briefed on the matter.

The Justice Department is continuing to examine whether Clearstream Banking SA and its parent company, Deutsche Boerse AG, provided a conduit for illegal Iranian transactions and made false statements to regulators during a review of Deutsche Boerse’s unsuccessful 2012 bid to buy the New York Stock Exchange, two people with knowledge of the matter said.

The investigation is being run by the office of Preet Bharara, the U.S. attorney in Manhattan, a holdover from the Obama administration who was asked to stay on by President Donald Trump. The inquiry picked up again last year, they said, after the sensitive international negotiations had been completed and the nuclear agreement had taken effect, and before the Nov. 8 election that carried Trump to the presidency."

"Saudi Arabia has sent a request for proposals (RFP) to banks for a planned U.S. dollar sukuk, or Islamic bond, two sources familiar with the matter said on Tuesday. The debt sale would be Saudi's second international bond offering, after the sovereign issued a debut $17.5 billion bond in October last year in what was the largest bond ever sold across emerging markets. The government approached lenders which had worked on Saudi's first issuance, one of the sources said."

"Saudi oil giant Aramco has received proposals from at least six banks for an advisory role on the firm's planned initial public offering on the Saudi stock exchange, sources familiar with the process told Reuters on Tuesday.

Saudi authorities are planning to list up to five percent of the world's largest oil producer on both the Saudi stock exchange in Riyadh, the Tadawul, and one or more international markets in an IPO that could raise $100 billion.

"Banks rejected a Saudi Telecom Co. plan to resolve a dispute over a missed payment on a $4.75 billion loan at a Turkish unit, prolonging a five-month impasse on the debt, people with knowledge of the matter said. The lenders turned down the plan because it involved taking a loss on the loan, three people said, asking not to be identified because talks are private. Saudi Telecom’s plan envisaged lending about $160 million to its Otas unit -- which missed the payment -- and also buying a direct stake in the business, they said. At present, the Saudi company only owns an indirect stake in Otas. Otas -- which owns 55 percent of Turk Telekom -- failed to make a $290 million repayment in September on the loan, Turkey’s biggest syndicated borrowing. A slump in the lira led to a decline in the dollar value of dividends Otas receives from the phone company and had counted on to help repay the loan, a person with knowledge of the matter said in October."

"Dubai's stock market fell on Tuesday, breaking technical support as construction firm Arabtec continued to slide, while Egypt rebounded from a drop triggered by foreign investors' selling.

Dubai's index sank 1.2 percent to 3,560 points, confirming a break of support on the mid-February low of 3,608 points; this triggered a double top formed by the January and February peaks and pointing down to around 3,500 points.

Arabtec, which plunged its 10 percent daily limit to a five-year low on Monday, slid a further 6.7 percent. The company reported a week ago that its net loss had widened in the fourth quarter and that its board was seeking shareholder approval for a 1.5 billion dirham ($408.4 million) rights issue."

"Opec’s Secretary General has predicted greater compliance from the world’s biggest producers with a supply cut deal to curb excess inventories. Speaking at the annual International Petroleum Week conference in London, Mohammad Barkindo said: “All countries involved remain resolute in the determination to achieve a higher level of conformity.” Late last year Opec countries along with producers outside the cartel agreed to curb global supplies to ease a crude surplus and stabilise an oil price downturn. It was the first joint supply deal since 2001."

"Rosneft PJSC signed investment and crude-purchasing agreements with Libya’s National Oil Corp. as more international companies return to the North African country to gain access to Africa’s largest reserves.

Moscow-based Rosneft agreed to invest in exploration and production in Libya, the state-run NOC said Tuesday in a statement on its website, without specifying the amount or timing of the investment. The companies signed a separate accord for Rosneft to buy Libyan crude.

The deals are part of a bigger push by the NOC to encourage additional investments by foreign oil companies to help Libya increase its production to 2.1 million barrels a day by 2020, according to the statement. Rosneft’s press service declined to comment when contacted by phone."

"Shares in Mediclinic dropped 7 per cent on Tuesday morning after the FTSE 100 hospital operator warned that a string of problems at the Abu Dhabi hospitals it bought in 2015 would cause profits to be lower than expected.

The company said its southern African and Swiss operations had performed well so far in the second half of its financial year, but revenues and underlying profit margins at its Middle East operations will be lower than anticipated.

Mediclinic agreed a $2bn reverse takeover of Abu Dhabi-based Al Noor Hospital Group in 2015, but patient volumes and operating performance have disappointed this year. The company had already warned about the difficulties earlier during its interim results, but the problems have shown no sign of improving since the start of its second half in September, and were “particularly pronounced in January”."

"The government of Oman is expected to announce the launch of a new U.S. dollar bond issue this week as it seeks to plug a budget deficit caused by low oil prices, sources familiar with the matter said on Tuesday.

Citi, HSBC, JP Morgan, Societe Generale and Standard Chartered have been appointed to lead the transaction, the sources said.

"Saudi Arabia has invited banks to pitch for an advisory role in the sale of Saudi Postal Corp to investors, sources familiar with the matter told Reuters.

The kingdom is launching a privatisation drive as part of wider economic reforms which aim to boost efficiency and ease pressure on state finances in an era of cheap oil.

Saudi Postal, the government-owned postal service, sent a request for proposals to local banks last month, according to bankers who spoke on the condition of anonymity because the matter is not public. No decision on which banks will participate has been made, two bankers said."

"Most Gulf stock markets fell early on Tuesday with Dubai hit once again by weakness in construction firm Arabtec after the company reported a fourth-quarter loss and plans for a rights issue a week ago.

Dubai's index lost 0.6 percent as Arabtec, which plunged its 10 percent daily limit to a five-year low on Monday, slid a further 2.2 percent. Shares in Drake & Scull, another builder which has been struggling financially, rebounded 3.0 percent.

Abu Dhabi climbed 0.5 percent as telecommunications firm Etisalat rose 1.4 percent. The company said it would pay the federal government a royalty of 30 percent of profits for 2017-2021, the same rate as in 2016."

"Chinese companies are big winners in the competition among foreign bidders for stakes in Abu Dhabi’s largest oil concession, snatching a combined 12 percent of the venture as the Middle Eastern emirate looks increasingly to Asia, its biggest market, for investment.

Abu Dhabi National Oil Co. awarded a 4 percent stake in the onshore venture -- the last share of the project that was still up for grabs -- to Shanghai-based CEFC China Energy Co., Adnoc said Monday in an e-mailed statement. CEFC is paying an $888 million signing bonus, Adnoc said. The announcement came one day after China National Petroleum Corp. agreed to buy 8 percent of the same concession for $1.8 billion."

"Iraq and Iran signed a memorandum of understanding on Monday to study the construction of a pipeline to export crude oil from the northern Iraqi fields of Kirkuk via Iran, the Iraqi oil ministry said in a statement. The agreement, signed in Baghdad by the oil ministers of the two countries, also calls for a commission to solve a conflict about joint oilfields and the possible transportation of Iraqi crude to Iran's Abadan refinery, it said. The pipeline would help Iraq diversify the export routes of crude produced in Kirkuk and reduce its reliance on transit through the Kurdish Region Government's territory."

"Russia hopes to get around European Union sanctions by reaching a deal with Iran for the supply of gas turbine equipment for two power plants in Crimea, the head of Russian state defence conglomerate Rostec said on Monday.

EU sanctions bar European individuals and companies from providing energy technology to Crimea, which was annexed by Moscow from Ukraine in 2014.

"Yes, we have problems with turbines, because Germany and some other European countries have banned deliveries to Crimea," Sergei Chemezov told reporters during a briefing in Abu Dhabi.

"Hedge funds and other money managers have amassed a very large bullish position in crude oil futures and options without so far having much impact on oil prices. Hedge funds raised their combined net long position in the three main derivative contracts linked to Brent and WTI by another 51 million barrels in the week to Feb. 14. Funds now hold a net long position equivalent to a record 903 million barrels of oil, according to an analysis of records published by regulators and exchanges"

"Saudi Arabia boosted oil exports and production last year to the highest monthly averages on record as the global crude market endured oversupply.

Exports climbed to 7.65 million barrels a day on average last year, from 7.39 million barrels a day a year earlier, according to Joint Organisations Data Initiative monthly data compiled by Bloomberg. Production rose to 10.46 million barrels a day from 10.19 million, on average, over the same period."

"Profit-taking swept across most stock markets in the Middle East on Monday, with United Arab Emirates bourses particularly hard hit by slides in construction company Arabtec and energy business Dana Gas . Dubai's Arabtec dropped by its 10 percent daily limit to a five-year low of 0.90 dirhams, falling below technical support at its December 2015 low of 0.93 dirhams. The company reported a week ago that its net loss had widened in the fourth quarter and that its board was seeking shareholder approval for a 1.5 billion dirham ($408.4 million) rights issue."

The stake is the last to be awarded in the concession after international energy companies including Total, BP and China's CNPC secured stakes. ADNOC owns 60 percent of the concession.

The onshore fields, operated by Abu Dhabi Company for Onshore Petroleum Operations (ADCO, have total resources estimated at between 20 billion and 30 billion barrels of oil equivalent over the term of the concession."

"Russia overtook Saudi Arabia as the world’s largest crude producer in December, when both countries started restricting supplies ahead of agreed cuts with other global producers to curb the worst glut in decades. Russia pumped 10.49 million barrels a day in December, down 29,000 barrels a day from November, while Saudi Arabia’s output declined to 10.46 million barrels a day from 10.72 million barrels a day in November, according to data published Monday on the website of the Joint Organisations Data Initiative in Riyadh. That was the first time Russia beat Saudi Arabia since March. Saudi Arabia and fellow producers from the Organization of Petroleum Exporting Countries decided at the end of November to restrict supplies by 1.2 million barrels a day for six months starting Jan. 1, with Saudi Arabia instrumental in the plan. Non-member producers, including Russia, pledged additional curbs. Brent crude prices have climbed about 20 percent since the end of November."

"Dubai’s financial centre grew by 14 per cent in 2016, bucking the trend of the emirate’s slowdown amid the regional oil price slump.

Active registered firms at the Dubai International Financial Centre, the region’s leading hub for financial firms, rose to 1,648 from 1,445 in 2015, helping the government-owned free zone’s profit rise 7 per cent to Dh421m ($115m) in 2016.

The number of financial firms in the DIFC grew by 10 per cent, while non-financial companies grew by 17 per cent and retail outlets expanded by 12 per cent."

"Pimco, M&G and Franklin Templeton have crashed out of a list of Europe’s 10 largest asset managers after investors pulled billions of euros from their funds amid concerns about performance over the past three years. Franklin, the emerging markets specialist, was Europe’s third-largest investment house by assets under management in 2013, but has fallen to 15th today, after suffering huge outflows from its funds since 2014. Pimco, which was once home to the world’s largest bond fund, dropped from ninth position in 2013 to 18th at the end of 2016, while M&G fell from 10th largest to 23rd, according to Morningstar, the data provider."

"The new Opec quota has been in force for six weeks, which is sufficient time to judge what is happening on the basis of facts rather than speculation. The key questions are, first, whether the restraints on production agreed last November are working or not and, second, whether the regime that came into force at the beginning of January can be sustained until June, as planned.

The oil price has been remarkably stable at around $54/$56 a barrel for Brent crude. That is about 15 per cent higher than before the November agreement but still barely half that seen three years ago. So will prices rise further or does the current level represent a ceiling? Let’s start with the facts.

Three things are clear. Most of the target reduction is being achieved but the response on a state-by-state basis is far from uniform. Three countries — Algeria, Venezuela and Iraq — have not cut production or have cut by less than they promised. Outside Opec, the situation in Russia is confused. Some production has been cut but the most recent reports suggest an increase in output and exports, particularly from the Urals. Most of the rest have met their quotas and Saudi Arabia has gone further — cutting output to less than 9.8m barrels a day, almost 300,000 barrels below its agreed quota. Without this, the target would not have been met."

"Gulf stock markets mostly fell in early trade on Monday with Dubai leading the slide, dragged down by a decline in construction firm Arabtec to a five-year low. The Dubai index dropped 1.0 percent as Arabtec sank 7.4 percent to 0.925 dirham, falling below technical support on its December 2015 low of 0.93 dirham. The company reported a week ago that its net loss had widened in the fourth quarter and that its board was seeking shareholder approval for a 1.5 billion dirham ($408.4 million) rights issue."

"Saudi Arabia’s Samba Financial Group named Rania Mahmoud Nashar as chief executive officer, the second woman recruited for a top finance-industry position in recent days as the country undertakes unprecedented social and economic change. Nashar’s appointment is effective Feb. 19, according to a statement to the stock exchange on Sunday. She replaces Sajjad Razvi who resigned for personal reasons. On Thursday, NCB Capital Co. CEO Sarah Al Suhaimi was named the first woman to chair Saudi Arabia’s stock exchange, the region’s largest. The appointments are significant for a country where the female unemployment rate is more than 34 percent and women aren’t allowed to drive. They also need a guardian’s consent to travel outside the country or marry. Change is starting to happen with the number of working women jumping 50 percent between 2010 and 2015, and more Saudi women entering male-dominated fields such as banking and engineering."

"United Arab Emirates-based Dana Gas on Monday revised down its unaudited preliminary results for 2016 to a net loss of $88 million from the net profit of $33 million which it had previously reported. Dana cited the result of a ruling by London's Court of International Arbitration earlier this month in its dispute with the Kurdistan Regional Government (KRG). Last week, Dana said the court ordered the KRG to pay $121 million to a consortium including it for condensate and liquefied petroleum gas. On Monday, however, Dana said the tribunal had also found that Pearl Petroleum Co, in which Dana Gas has a 35 percent stake, was entitled to interest on overdue receivables from the KRG at the London interbank offered rate plus 2 percent. Previously, Dana had calculated its own share of overdue receivables under different assumptions."

"Saudi Binladin Group (SBG) has received substantial payments from the Saudi Arabian government to settle debts since the start of this year, a boost to the struggling construction conglomerate and to the kingdom's economy, banking sources said. SBG has received 2.4 billion riyals ($640 million) so far this year for its work on state projects including the King Abdulaziz International Airport in Jeddah, one banker said, declining to be named because the matter is not public. A second banker, whose institution has direct exposure to SBG, put the figure for payments to the group since the beginning of 2017 at 3.1 billion riyals. Details of banks' financial information on SBG can vary because they are involved in different loans to it."

"Stock markets in the Middle East were mixed in modest trading volumes on Sunday with Saudi Arabia and Qatar outperforming because of support from the banking sector, while Egypt fell as the currency hit a three-month high.

Two-thirds of the 12 listed banks on Saudi Arabia's bourse gained, lifting the index 0.1 percent. Alawwal Bank added 2.7 percent, with most activity occurring in the last hour of the session.

Reuters reported on Sunday, citing banking sources, that builder Saudi Binladin Group had received hundreds of millions of dollars from the government to settle debts since the start of this year - good news for the company and its bank creditors."

"Abu Dhabi National Oil Co. awarded a stake in its largest oil concession to China National Petroleum Corp. as the Middle East emirate brings in more foreign investors to raise crude production capacity.

CNPC will take an 8 percent stake in the oil-production joint venture in return for paying a $1.8 billion signing bonus, Adnoc said in a statement Sunday. BP Plc joined the project in December for a 10 percent stake after Total SA took the same share in January 2015."

"JP Morgan said it expects to keep its market share of investment bank fees in the Middle East steady in 2017 after doubling it last year, topping the rankings on the back of a boom in international bond sales from the region as governments plugged low oil price created deficits with borrowed cash.

The American bank’s bumper year in the Middle East also came with an upsurge in fees from mergers and acquisitions including those from advising on Saudi Arabia’s US$3.5 billion investment in Uber and Qatar National Bank’s €2.7bn (Dh10.52bn) purchase of Finansbank of Turkey from National Bank of Greece.

"The Middle East was always a modest borrower in the world of emerging markets and it’s now taking its fair share because these deficits are there," said Sjoerd Leenart, the chief executive of the Middle East, Turkey and Africa for JP Morgan."

"The Gulf Cooperation Council (GCC) governments have been working hard to address the rising fiscal gap following the sustained decline in oil prices, but the problems persist and further reduction in deficits and revenue diversification are required to sustain economic growth and job creation, according to economists and multilateral agencies. GCC fiscal deficits are forecast to narrow in 2017 to an aggregate of 6.5 per cent of GDP in 2017 on higher oil revenues. The narrower deficits and ongoing foreign borrowings are expected to result in banking sector liquidity easing in 2017. But as a result of the fiscal tightening, support to growth is expected to moderate, potentially impacting GDP and employment growth. Speaking at the recent Arab Fiscal Forum, Christine Lagarde, Managing Director of the International Monetary Fund (IMF) called on regional governments to deepen and broaden government revenues while rationalising spending."

"Iran's foreign minister on Sunday stepped up efforts to improve ties with Gulf Arab Sunni states urging them to work with their Shi'ite rival to address "anxieties" and violence across the region. Iranian President Hassan Rouhani last week traveled to Oman and Kuwait to try improve ties, his first visit to the Gulf states since taking power in 2013. The six Arab members of Gulf Cooperation Council (GCC), especially Saudi Arabia, accuse Iran of using sectarianism to interfere in Arab countries and build its own sphere of influence in the Middle East. Iran denies the accusations."

"NCB Capital Co. Chief Executive Officer Sarah Al Suhaimi will become the first woman to chair Saudi Arabia’s stock exchange, the largest bourse in the Middle East.

Al Suhaimi was appointed chairwoman of the Tadawul, replacing Khalid Al Rabiah, the exchange said in a statement on Thursday. She is expected to keep her position at NCB Capital, the investment banking unit of National Commercial Bank, a person familiar with the appointment said. Al Suhaimi was the first female head of a Saudi investment bank when she assumed the role in 2014."

"Stock markets in the Gulf were mixed in early, quiet trade on Sunday with Saudi Arabia and Qatar outperforming because of support from the banking sector as United Arab Emirates bourses succumbed to profit-taking. Nine of the 12 listed banks on Saudi Arabia's bourse gained in the first 45 minutes of trade, lifting the index 0.4 percent. The largest Islamic lender, Al Rajhi Bank, added 1.5 percent after its chief executive told Reuters that the bank gained market share in corporate banking last year for the first time in four years, and would continue to expand in that area by focusing on healthcare services, affordable housing, transportation and energy."

Saturday, 18 February 2017

"Saudi Arabia is close to appointing the banks that will be lead underwriters on the initial public offering of Saudi Aramco, the world’s largest oil producer, which is aiming to become the most valuable listed company. JPMorgan, Saudi Aramco’s longstanding commercial banker, is in pole position to be a global co-ordinator and bookrunner for the planned sale of a 5 per cent stake in the state-controlled company in 2018, according to several people briefed on the flotation process. Morgan Stanley is also expected to be a global co-ordinator and bookrunner on the listing, said some of these people. The bank held this role on the flotation of Alibaba, which in 2014 set a new record for IPOs by raising $25bn from investors."

"The net income of Arabian Gulf banks is forecast to drop by 5 to 7 per cent this year as the sector grapples with weak revenues and higher credit losses, according to Standard & Poor’s. Bank profitability decreased last year amid a rise in money set aside to cover bad debts and slower loan growth as economies in the region slowed. "Operating revenues are ­weakening, credit losses increasing and the net bottom line is under pressure," said Suha Urgan, S&P’s Dubai-based lead analyst for financial institutions."

"NCB Capital Co. Chief Executive Officer Sarah Al Suhaimi will become the first woman to chair Saudi Arabia’s stock exchange, the largest bourse in the Middle East.

Al Suhaimi was appointed chairwoman of the Tadawul, replacing Khalid Al Rabiah, the exchange said in a statement on Thursday. She is expected to keep her position at NCB Capital, the investment banking unit of National Commercial Bank, a person familiar with the appointment said. Al Suhaimi was the first female head of a Saudi investment bank when she assumed the role in 2014."

"Some of the world's biggest sovereign wealth funds are increasingly striking their own private equity deals rather than relying on external fund managers, in a drive to cut costs and gain more control.

With some $6.5 trillion in assets, sovereign investors already account for 19 percent of capital committed to private equity, according to data from research firm Preqin.

But mega-funds such as the Abu Dhabi Investment Authority (ADIA), Saudi Arabia's Public Investment Fund (PIF) and Singapore's GIC, are hiring specialists to find or vet deals - enabling them to negotiate with private equity firms from a position of strength or to go it alone."

"Iraq plans to acquire a "large fleet" of oil tankers to transport the OPEC nation's crude to global markets, Oil Minister Jabar al-Luaibi said in a statement on Friday.

The nation's tanker fleet was largely destroyed during the U.S.-led offensive to dislodge Iraq from Kuwait in 1991, according to the state-run Iraqi Oil Tankers Company's website. The company owned as many as 24 tankers in the 1980s.

"The ministry is keen to restructure the company and develop its operations by building and buying a large fleet of tankers," Luaibi told the company's management, according to the statement."

"Norway’s government has proposed the biggest changes to the world’s largest sovereign wealth fund in decades, cutting the amount of oil money the country can spend each year and tilting the fund towards higher risk by investing about $90bn more in stock markets.

The $900bn oil fund should be able to invest 70 per cent of its assets in equities, up from 60 per cent, the centre-right government said as it backed proposals made by the fund itself and an expert group.

The shift, which needs parliamentary approval, would be significant for global markets since the fund on average already owns 1.3 per cent of every listed company. The increased investment in equities would come at the expense of buying bonds as the oil fund, which has an investment horizon of a century or more, tries to increase its returns."

"Complications restructuring Saudi Arabia’s state-owned oil company and disentangling its finances from those of the government are slowing the march toward what is expected to be the biggest IPO in history. The hotly anticipated listing of a minority stake in Saudi Aramco (Private:ARMCO) is now unlikely to happen until late 2018 at the earliest, WSJ reports, and if foreign advisers have their way, it won't happen until 2019."

"It may seem a strange position for an active fund manager to adopt, but I am in favour of passive or index investment. The advantages of index investing are clear. Investors can invest in a widely diversified portfolio at minimal cost as management charges are low, as are the costs of dealing. The obvious drawback to index funds and exchange traded funds (ETFs) is that they deprive investors of the opportunity to focus their investment only in good companies and/or shares which offer reasonable value or better. However, it seems that most active fund managers do not even attempt to invest only in good companies, or if they do they are not very good at identifying them. They seem to have similar problems in determining what is reasonable value."